NBFC Account Aggregator License

NBFC Account Aggregator License (NBFC AAs) play an essential role in the financial sector as intermediaries facilitating and providing access to and sharing financial information for customers with multiple accounts in various Non-Banking Financial Companies (NBFCs). As an approval agency, NBFC AA ensures that financial information exchanged between financial institutions is done with the transparent permission of the customer, safeguarding data privacy and security. They act as effective ways to transfer this information, preserving its integrity during transmission securely. In addition, NBFCs also act as AA data warehouses, where financial information shared by customers across sectors is stored for future retrieval, providing a detailed view of their financial status and history. It is important to emphasize that NBFCs act as unbiased facilitators in the financial management of AA. Financial services will not be provided directly to clients but, instead, will be focused on simplifying and improving the sharing and retrieval of financial information, making services more client-friendly and secure. Organizations interested in obtaining an NBFC AA license must go through a structured application process monitored by the Reserve Bank of India (RBI).NBFC AA is not directly tied to any financial Service and instead helps only in facilitating financial information. In this write-up, we will learn about the vital aspects of an NBFC AA license, the documents, and the procedure to acquire an NBFC AA license.

Requirements

The provisions of an NBFC Account Aggregator Licenseare as follows:

• In the NBFC AA license, there is a minimum requirement of 2 crores with a one-year funding period after approval from the RBI; the NBFC AA will only be allowed for services with the integration.
• After the regulator from the NBFCAccount Aggregator, there will be a time limit to set the design and the requirements that are essential to carry out the business.
• As per the guidelines provided by the RBI, the items related to the financial sector, which various regulators hold, are excluded from the approval of the RBI. And these NBFCs are not allowed to make transactions on money-related tests as other NBFCs.
• The NBFCAA will have to provide data recording to the client's financial users, and they are not allowed to perform any related activities like other NBFCs. Also,NBFCAccount Aggregators are not allowed to use the data related to the financial resources of the customer for any other requirement.

Eligibility

The eligibility for NBFC Account Aggregator License is as follows:

• The business must have a plan to determine whether the RBI rules apply to the promoters of the Company.
• As per the directives of the Company, a declaration must be given by the CEO, managing directors, or directors.
• The annual clarification must be given in case of alteration of the CEO/directors/managing director. It must be ensured that the clarification is appropriately stated by the authorities within 15 days of the year closing for the fit and valid requirements.

Role

The Role of NBFC Account Aggregator License is as follows:

• The primary role of the NBFC-Account Aggregator is to provide data to the customer's relations.The data are stored in a sorted, combined, and retrievable way. The services provided by the account aggregator are voluntary for a customer to accept or not.
• IT-oriented operations are taken up by NBFC-AA, which helps collect the specialized data of the customers of the NBFC-AA. The NBFC-AA is primarily an account collection mechanism, and they do notentermonetary resource exchange like NBFCs in the way of operation. The NBFC aggregator can transfer the investment surplus in instruments without any exchange mechanism.
• The NBFC-AA (NBFC Account Aggregator) of the financial services is required to have a clear understanding of the roles of the aggregator, customer, and provider.
• Lastly, the NBFC-AA is involved in the collection of resources on monetary information of the company/ business and then transfers it in a sorted, merged, and retrievable file for the customers.There are also rules drafted by the RBI that state the rules that must be followed by the Aggregators for such substances.

objectives

There are specific objectives of the NBFC Account Aggregator License that are stated as follows:

• The primary objective of a NBFCAccount Aggregator is to provide information regarding the different accounts of the client.
• An appropriate mechanism for the documentation has to be made; the information stored regarding the client is in a consolidated, merged, and retrievable structure, and it depends upon the customer whether they would like to use the Account Aggregator services.
• Data of the customers are not shared with other financial such as banks, NBFC, Mutual Funds, insurance repositories, etc, without the consent of the customer.
• The NBFC shares banking transaction data such as current savings, recurring, and account statements in the AA network.
• The NBFC will not support any customer transactions.
• The NBFC will not employ any third-party services for the functioning of the business.
• In case of any dispute between the  Aggregator Account and the financial information in the FIP documents, the FIP Documents position will be superior.

Advantages

There are several advantages of an NBFC aa license, which are depicted in this section as follows:

• It helps save the customers time and effort
• It allows for monitoring the expenses as well as the income of the customer
• It gives provision for making better decisions
• It converts all the financial data of the customer into easily accessible digital data format
• It also provides a high level of security for customer data sharing

Documents

The documents that are needed for an NBFCAccount Aggregator are as follows:

• Application to the Reserve Bank for the certificate of registration
• A minimum investment of rupees two crore
• A certificate from the statutory auditor will certify the net fund of the Company.
• ID proof suggested, such as Aadhar, passport, or voter
• Balance sheet
• Cash Flow Statement
• Income statement
• Future projection of the Company (for the next three years)

Process

The NBFC Account Aggregator registration is done according to the master directions published by the RBI. The method of the NBFC Account Aggregator is as follows:

1. To register for the NBFCAccount Aggregator, the Company should get the registration under The Companies Act 2013.
2. The next step is to have the necessary essential assets to provide the services.
3. Now, the organization must have a capital structure strategy, and the overall personality of the administration must not be affected by any misconduct.
4. The administration's overall conduct must not have been biased due to complications.
5. The Certificate of Registration (CoR) will have to be obtained from the RBI for conducting the aggregator activities.
6. To get the Certificate of Registration, the application must be submitted to the RBI.
7. At least 2 Crore must be available with the Company for business conduct.
8. Now, that application must be submitted to the RBI to grant the registration certificate.
9. Promoters of the business must be fit and authentic.
10. There must be a data innovation structure for the conduct of the services of the account aggregator.

Cancellation

NBFC Account Aggregator License is canceled for the following reasons:

• If the Company stops its functioning of NBFC Account Aggregator operation.
• If the Company fails to comply with any terms of the registration or even the provisions of the RBI.
• If the Company does not fall in the eligibility criteria for the grant of the Registration certificate.
• Or the business violated any terms that are essential as a requirement for the Registration Certificate.

• Or the Company needed to follow the instructions provided by the RBI appropriately.
• Or the business did not disclose the financial information required by the bank or which is stated by the regulatory authority under applicable law.
• Or the business did not file the books of account with the bank for verification.

Why Adviso?

The process of NBFC Account Aggregator License involves a wide range of requirements, document preparation, and pre- and post-compliance obligations. It is essential to comply with the specific terms of the NBFCAccount Aggregator License. The incorporation of a NBFCAccount Aggregator License can be a tedious process without professional support. That’s where Adviso comes in.

At Adviso, we provide expert services for society registration online approvalunder the NBFCAccount Aggregator. Our Lawyers, CA, and CS experts guide you through every step of the journey to ensure your Company lists smoothly and efficiently.

With Adviso's expertise and assistance, you can easily navigate the complexities of Society registration, saving time and ensuring compliance with all necessary regulations.